Major currencies have been choppy but in very narrow ranges since Friday as markets grapple with governments’ still opaque plans to ease national lockdowns and the magnitude of a likely sharp economic slowdown in Q2.
The GBP/USD cross has fallen from 1.26 to 1.244 – the level which prevailed a week ago – although it traded as high as 1.248 earlier this afternoon.
The Euro has been on a weaker trajectory in recent sessions, with the EUR/USD cross falling from 1.10 before the weekend to1.086 today but still finds itself near the levels which prevailed last Thursday.
Similarly the Swiss Franc has been under modest pressure, likely fuelled in part by weaker-than-expected Swiss CPI-inflation data. Headline CPI-inflation fell to -1.1% yoy in April (versus a -0.8% yoy consensus forecast) from -0.5% yoy in March, with a strong Swiss Franc earlier this year likely contributing to a now rapid rate of deflation.
The Australian Dollar made small gains before and after the Reserve Bank of Australia’s policy meeting this morning – at which it left its policy rate unchanged at 0.25% as expected – but the AUD/USD cross is effectively only back to its 1st May level.
